By Yolanda Spivey
When someone wins the lottery, you expect their economic circumstances to change. But that’s not always the case, since many lottery winners aren’t the best at managing their money. In fact, the mere purchase of lottery tickets has been shown to be a bad investment for most of us. The State of Michigan and taxpayers in that municipality were outraged at new finding that over 3,500 people were collecting welfare benefits or living with someone who did, after winning the lottery.
This is reminiscent of the case of Amanda Clayton, a Detroit woman who won a $735,000 jackpot in 2012. She continued to collect welfare benefits and was adamant that she had a right to state assistance although she won a large sum of money. She later died of a drug overdose, which could be an indicator of where much of her money was going.
The new findings in Michigan have caused legislators to enact a law that requires the state to match lottery winners with those who receive public assistance. Anyone who wins over $1,000 will be notified by the state. There is the question as to whether or not $1,000 is enough to get someone off welfare for good. After all, that’s not even enough to buy a car. But at the very least, all of those on public assistance are expected to report their winnings to the state.
Other states are following a similar suit. For instance, North Carolina legislators have drafted a law forbidding people on welfare or bankruptcy from buying lottery tickets. It is still unclear how this law will be enacted.
Lotteries are often considered to be a “tax on the poor” because they heavily market to those groups. A 2008 study found that people who earn less than $13,000 a year spend 9% of their earnings on lottery tickets.
The Associated Press is reporting that 14% of Michigan lottery winners took home an average of $6,800. Critics all agree that that amount of money isn’t enough to change a person’s lifestyle.